Serious affordability pressures for first-time buyers are lurking in industry house price data, a lender has warned.

Skipton Building Society’s Chief Executive of Homes, Charlotte Harrison (pictured), says that despite industry data suggesting the housing market remains resilient, there are issues hiding beneath the surface, particularly for first-time buyers.

She says: “The resilience we’re seeing in the housing market is encouraging, particularly given ongoing economic uncertainty.

“However, this headline stability masks very different realities depending on where people live and their stage of life.”

She says many first-time buyers remain under significant pressure and that “rising rental costs are compounding this challenge, making it harder for would-be buyers to get ahead”.

House price data

Harrison’s comments follow Zoopla’s latest data, which showed house price inflation is holding steady at 1.3%, compared to 1.8% a year ago – with the average price of a UK home sitting at £271,700.

The industry data is in contrast to Skipton Building Society’s own data – its Home Affordability Index – which reveals just 12.1% of potential first-time buyers can afford to purchase in their local area.

It also suggested that around 40% are already spending more than 45% of their income on housing costs, leaving them with little room to save for a deposit.

Deposits are another big barrier, with the average now exceeding annual incomes and more than half of first-time buyers relying on two or more full-time earners to get onto the ladder.

Where homes remain relatively affordable, activity is holding up well. But in higher cost areas, buyers have far less flexibility.”

The Skipton data also reveals widening regional gaps, with typical first-time buyer deposits in London equivalent to around 140% of household income – roughly double levels seen in northern regions.

Harrison adds: “Where homes remain relatively affordable, activity is holding up well. But in higher cost areas, buyers have far less flexibility, which continues to weigh on confidence and decision making.”

She is urging lenders and the wider industry to respond through “continued innovation, improved flexibility and practical support” to keep homeownership within reach.